This post is all about the 4 best passive income streams to create this 2023.

Money is a resource that we are all going to manage one day. We are even doing it now in small quantities. The problem is that we have never been taught how to manage and control that money, letting the Estate, taxes, and capitalism play with it as they wish.

And the biggest lie is that we have been taught that we have to work FOR money. Instead of making money working for the US. You may be asking yourself: how the hell can you make money work for you?

We´ll cover that soon, but before we start I want to introduce you to the term financial independence.

Financial independence, if you have never heard of it, can be defined as being in such a position where you have enough income to pay one’s living expenses without having to be employed or depend on anyone.

Many people think it´s only possible when we retire (when we receive our pensions), but that´s not the truth.

The benefits of achieving your financial independence are many, but I think that we can all agree that the most important one is FREEDOM. Not being obligated to go to work every day, doing something that you don´t enjoy. Being able to go on vacation any time you want, where ever you want, and as much time as you feel like it. It gives you the possibility to move freely not being chained to a salary…

My question to you is: are you ready to learn the main ways in which you can create passive income streams, thus achieving your financial independence?

what is passive income streams? Active Income v.s. Passive income

How can we make money work for us? There are two ways of earning money in this world: actively and passively.

If we want to make money work for us and achieve our financial independence we need to focus on creating PASSIVE INCOME streams.

Active income

When you receive active income that means that your earnings are directly related to the time you spend performing a service. For example wages, tips, commissions…

Passive Income

Passive income consists of earnings or an income in which the person is not actively involved.

To put an example is like wanting to create a snowball that rolls down a ladder by itself. You have to put in the effort, in the beginning, to create the snowball and make it big enough until it starts moving on its own. And when it starts rolling and becoming bigger and bigger, that´s when the magic happens.

Creating passive income streams is similar to that. You put the effort, in the beginning, to create the stream and automatize it, but when it starts rolling and creating money on its own, without you being actively involved that is how you make money work for YOU. One of the great things about passive income is that, as long as it keeps rolling, the income doesn´t stop coming, not even when you´re sleeping, or o vacation.

Now that we have talked about the theoretical part of this key point to achieve your financial independence, let´s discuss the more practical part. How can we create passive income streams?

The 4 best passive income streams

Ideas for passive income streams. Education

The first one that we are going to talk about is Education. Yes, you read it right education.

This option is barely considered because it doesn´t directly give you an income stream. But if you think about it, everything starts with education. How can we expect to be successful at anything if we don´t take the time to educate ourselves?

Many people think that we stop learning when we finish school, but that shouldn’t be true. Especially in the constantly changing environment where we live in. Because soon successful people are going to be the ones able to adapt themselves to the evolution that the world is going through our very eyes. We live in a moment of change and uncertainty where nowadays skills, knowledge, and beliefs are soon going to become useless.

Think of education as a long-term investment. One that will give you the resources and the knowledge to be great and succeed at any project you choose to pursue.

Intellectual Passives

The second main way of creating passive income streams is Intellectual passives.

Have you ever thought about turning your experience and skill in a specific area that you master into something profitable?

We live in the era of information where people can find the answer to any question with just a phone and some internet. And the best thing is that many people today are willing to pay for those answers and that information.

Think of a skill or an area that you master. Did you know that you can create a course, masterclass, ebook… sharing that information? It is 100% doable and many people are making a living out of it.

There are many platforms through which you can create a course or masterclass, making the task even easier. You can choose the format (video, audio, text), the length, and the content you are going to share.

And once create it, you just need to worry about distributing it.

Before you think that you don´t have any skill that you can turn into something profitable or that no one is going to buy your course, e-book or masterclass, know that in Brasil, people are making crazy money selling courses on how to fix washing machines or sharpen a knife. For any crazy idea, there is a crazy audience willing to pay for it.

Best passive income streams.Investing

The third option that we are going to discuss today is investing. Investing is considered as the action to put forth capital to earn a profit or an income.

Inside this method of creating passive income streams, there are 4 big families in which investments are divided: Raw materials, Real estate, the Stock market, and Mutual funds.

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All of these four families are great to grow your income, but they are serious things. If you decide to use one of them, educate yourself on the matter. There are thousands of books and courses about these four families and how to benefit from them. Putting your money in a financial system that you don´t understand is a big risk.

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Raw Materials

This branch consists of investing in raw materials such as gold, silver, iron, seeds…

Real Estate as a passive income stream

Investing in Real Estate means purchasing a property, which you then rent or sell, to generate an income.

Real estate includes houses, offices, apartments, commercial spaces… You can even start with smaller things that require less capital like agricultural or raw lands, garages…

If you think that you don´t have enough money to buy a property on your own or you don´t feel confident enough to make the move, let me tell you about Real Estate Crowdfunding.

Real Estate Crowdfunding is a method that consists of a group of investors coming together to participate in a real estate project. One of the benefits is that you can invest as much money as you feel comfortable.

Stock Market

The third family is the Stock Market.

We could spend years and years trying to understand the Stock Market. But to benefit from this method of earning a passive income we only need to understand the basics. Besides what makes the Stock Market such an interesting option is the compound interest effect that is created when we invest long-term on a share (a part of a company that you can buy on the Stock Market) or a fund (a group of shares/stocks).

Compound interest, if you have never heard of it, it´s the interest of a capital to which its interest is accumulated so that they produce another one.

So say for example, that you invest in a fund on the Stock Market. In the beginning, you invest 1,000 $ and you commit to yourself that every month you are going to invest another 50$ for the next 20 years.

At the end of those 20 years, thanks to the compound interest, those initial 1,000$ will turn into 35,000$ approx.

But what if we took it to 50 years instead? Those initial 1,000$ thanks to the compound interest and the monthly contributions will turn into 460,000$ approx.

Compound interest calculator. The average “estimate rate of return” for the stock market is between 6-8%.

The beauty of compound interest is when it´s used in long-term investments, and the sooner you start the better, because that´s when the magic happens, especially taking into account that the only effort that you have to do is fulfill the commitment to investing an established amount monthly or annually.

Mutual Funds

The 4th and last family is Mutual funds.

Mutual funds are a type of investment formed when an organization, company, or fund house pools investments from several individuals who have common investment objectives.

Now investments are great when you have more capital to “play” with. But what if you don´t?

That´s when the last way of creating passive income streams comes.

how to create passive income streams with modern passives

Modern Passives consists of all the new ways in which you can create passive income streams thanks to the technological era. They are characterized by the small amount of capital required to create these incomes.

Let´s see some examples:

• Affiliate Marketing: Selling others people´s products in exchange for a small commission. This option is great if you have a community or platform to offer those products to.
• Having a youtube channel or a blog: These may not seem like a way to create passive income, but the passive earnings actually come from the videos or articles individually. You create them once and they make money without you being actively involved.
• Dropshipping: the dropshipping model works like this-

Let´s say that you have a digital store. And you have a customer that places an order of a certain product. You then proceed to order to your supplier the customer’s order. The supplier is the one responsible for the distribution, packaging, devolutions, storage…

• Creating products for others people’s digital stores (agendas, coloring books, mugs, clothes…). I want to talk about a specific platform that I personally tried.

Amazon KPD. Amazon KDP (Kindle Direct Publishing) is a platform created by Amazon where you can self-publish your own books through their website. You can create Kindle or Paperback books. And the type of books can go from novels to kid’s books, from agendas to coloring books… the choice is yours.

There are many platforms out there similar to Amazon KDP that you can try and create an income stream with.

The great thing about this option is that you don´t need to worry about storage, distribution, website… and the costs that come with it. You just need your imagination and creativity.

As you see there are numerous options for creating passive income streams and more and more options are appearing thanks to technology.

2 quotes that changed my perspective about saving money

A very important skill when talking about money and how to achieve your financial independence is saving. There is a really powerful quote about this discipline:

What do you do if you have an $? Not waste all of it.

Saving is about habits. It´s not about the one-time expense that you avoid, but about the daily or weekly expenses, you have that you don´t give much thought to. Those expenses accumulate day after day, week after week and they really start to add up.

Saving is a skill that we should all master, whether we have a specific goal in mind or not. But rather than learning to save, it´s more about taking care of your lifestyle cost. Meaning how much it cost you to maintain your actual lifestyle and if there are any costs that you can eliminate or minimize and instead use that money on investments, new projects, education…

Another thing to take care of when talking about our lifestyle cost it´s our natural habit to raise or elevate our lifestyle cost when our income increases. The benefit of increasing our income is the opportunity to elevate our lifestyle and life quality. But the point is to find that equilibrium between increasing your lifestyle cost and still leaving that gap or margin to keep investing and keep that money working to create more money. You have €/$, but you only waste apart.

Saving is not about being cheap, it´s about the type of person you become if you let yourself fall into the consumer’s wheel of always wanting to climb a step higher in the pyramid of quality and quantity.

If you think about it, people don´t buy a Prada or Chanel bag because of the quality, that is not their main motivation. It´s because of what the brand means. Those luxury brands like Porshe, Tiffany & Co, Louis Vuitton… mean social status, attention, and acceptance.

When we think about saving, we think about a cheap lifestyle, but it´s actually about the mindset, about choosing your expenses and how you pay them.

Let me tell you the best financial advice I have ever learned. Ready?

Think about something that you really want, something that you have wanted for a long time. Now ask yourself:

Who is going to pay for that?… NOT YOU.

Who is going to pay for that something that you want? Not you.

The idea with this question is to shift that mentality of spending money we may not have on things we want. It forces you to ask yourself what do I need to do to pay for that something I want?

Another benefit of changing this mental path is changing the mentality of “I don´t have money to pay for this or that”, the thought of lack and poverty into AMBITION: what do I need to do to be able to pay for something that I want?

Final thoughts on the best passive income streams

The key to your financial independence is to make money work for you, and not the other way around.

We can do that by creating passive income streams (earnings in which a person is not actively involved). We discussed 4 ways of creating passive income streams:

• Education, Intellectual Passives, Investing (and the four big families in which investing is divided), and Modern Passives.

We learned about compound interest. A very powerful tool to multiply your money with hardly any effort.

And last but not least I shared with you two powerful quotes that changed my perspective on saving:

• If you have a €/$, don´t waste all of it.
• Who is going to pay for that? Not ME

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Disclaimer: The content in this article is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. All content in this article is information of a general nature and does not address the circumstances of any particular individual or entity. You alone assume the sole responsibility of evaluating the merits and risks associated with the use of any content in this article before making any decisions based on such information.

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